Russia, faced with default risks, says it will do everything possible to pay creditors

© . Russian Finance Minister Anton Siluanov delivers a speech at a session of the House of Representatives in Moscow, Russia, March 11, 2020. REUTERS/Evgenia Novozhenina () – Russia will do everything it can to ensure that its creditors receive their money Finance Minister Anton Siluanov said Thursday, a day after the country got closer to a possible default on its international debt. Russia has been able to service its foreign currency debt since the start of what Moscow calls “a special military operation” in Ukraine on Feb. 24, and has encountered problems with foreign currency payments on its Eurobonds. On Wednesday, Russia said it had to pay rubles to holders of its dollar-denominated Eurobonds maturing in 2022 and 2042, as a foreign bank had refused to process an order to pay $649 million to holders of its sovereign debt. “We will do everything we can to ensure that creditors receive their invested money from the Russian Federation,” TASS told Siluanov news agency. Siluanov said the state monopoly of Russian Railways (RZhD) will not be allowed to pay dollars on its Eurobonds and that the company will pay rubles instead, according to Interfax news agency. “Nevertheless, the obligations will be met: like the Russian Federation, RZhD will do it in rubles,” Siluanov told reporters, Interfax reported. Russia has not defaulted on its foreign debt since waiving payments due after the Bolshevik Revolution of 1917, but its bonds have become a flashpoint in the diplomatic crisis over Ukraine and sanctions between Moscow and Western capitals. Siluanov also said his ministry would advise banks not to pay dividends on their 2021 financial results, Interfax said.

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